Pre-orders and Medical Devices

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Maltese's picture
Pre-orders and Medical Devices

Investment captial is essential to medical device startups.  One can have a great idea that clinicans believe will be helpful, that has strong IP, a clear regulatory path and CMS reimbursement code, and yet will struggle to get started b/c investors will not commit.  Investors want some sign that someone will buy it.  Thus, the concept of a pre-order . . . soliciting and taking money from a prospective customer with the promise of delivering the product at a later date and a way to refund the money if the delivery does not happen . . is not found in med devices to my knowledge.  Pre-orders bring two things to the table - capital (equity-free capital) AND a paying customer (investors like to see these).   One might say that pre-orders are not possible in a regulated industry.  To the contrary, the automaker Tesla (certainly regulated at the federal and state level) raised $500M from 500K pre-orders with delivery at this writing expected at the end of 2018.   Is it that FDA regulations specifically preclude pre-orders?